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Opening doors to affordable housing in Toronto

Toronto is cutting red tape and offering financial incentives to get developers to build affordable housing.

Ahmed Makhlouf hugs his cat Mickey in the apartment he rents. The 62-year-old is disabled with back issues and other health problems. More than 60 per cent of his disability benefit goes towards housing but he cannot find a cheaper place to live. (Chris So / Toronto Star)

Toronto will spend more than $272 million over the next five years to boost construction of affordable housing through fast-tracked building approvals, development fee exemptions and property tax holidays.

“It’s a big commitment from the city,” said Councillor Ana Bailao, chair of the city’s affordable housing committee and the mayor’s point person on the new Open Door Program which received final approval by city council this week.

“We know that if we continue to do business as usual, we are not going to reach our targets.”

The city has set a 10-year goal to create 10,000 affordable rental and 3,000 affordable ownership homes by 2020. Without the program, Toronto risks missing the target by 6,600 affordable rental and ownership homes, according to city staff.

Ahmed Makholouf, who suffers from multiple health problems and spends about 60 per cent of his income on rent, is a member of one of almost 88,000 households on Toronto’s affordable housing wait list.

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“While I have been waiting, the city has been doing nothing,” said the single father who moved to Toronto from Montreal in 2007 to be near his ex-wife after he suffered several strokes.

Makholouf, 62, has been waiting for an affordable unit since 2010 and “barely survives” on about $1,500 in Ontario Disability Support Program benefits, including a special diet and transportation allowance.

“I am happy to hear they are doing something,” he said of council’s decision this week.

After raising his boys in a two-bedroom apartment near Victoria Park Blvd. and St. Clair Ave. E., Makholouf is now an empty nester. But down-sizing isn’t an option because vacant one-bedroom apartments in his building cost more than the $935 monthly rent he currently pays.

“So I am stuck,” he said. “It is no life.”

Councillor Ana Bailao, Mayor John Tory and Councillor Pam McConnell walk together in Regent Park before speaking to the media about the implementation of the Mayor's "Open Door Program," which is aimed at boosting affordable housing in Toronto. (Melissa Renwick/Toronto Star)

Under the Open Door Program, non-profit and private rental housing projects are eligible for development fee exemptions and municipal tax waivers on new units if they are affordable for a minimum of 25 years.

For a unit to be deemed “affordable” under the program, monthly rents must be no higher than $1,110 for a one-bedroom, $1,301 for a two-bedroom and $1,531 for a three-bedroom. To receive federal-provincial funding, maximum monthly rents for one- two- and three-bedrooms are $888, $1,041 and $1,225 respectively.

For affordable ownership, the city’s Home Ownership Assistance Program can provide $25,000 in funding per unit to help cover development charges and other fees. Developers must be non-profit groups, such as Habitat for Humanity, or building on public lands.

Eligible purchasers will receive a $25,000 no-interest, no-payment down-payment assistance loan from the developer that doesn’t have to be paid back until the unit is sold. That money helps provide the next loan under the program.

Since time is money, all eligible rental and ownership developments where at least 20 per cent of the homes are affordable will have access to dedicated staff within the city’s planning department to fast-track approvals, shortening the wait for typical applications from 18 months to 12, Bailao said.

The city is also freeing up more surplus municipal land for the initiative and is urging other levels of government to do the same.

A new guide will help developers understand the initiative, she added.

A new 82-unit building has since been approved and environmental remediation has begun under the new scheme, Bailao said.

A second pilot project on a stretch of derelict Railway Lands property that the city has been trying to develop as affordable housing for more than 20 years, got the green light at council Tuesday, thanks to the Open Door Program, she added.

The 80-unit rental building east of Bathurst St. and south of the rail corridor is among seven affordable rental and ownership projects approved this week using tools from the program.

“I don’t recall a council meeting since I was elected (in 2010) where we had 294 units of affordable housing approved, both ownership and rental,” Bailao said.

The program dovetails with the province’s recently introduced inclusionary zoning legislation that will give Toronto the power to force developers to build affordable units. New money for affordable housing construction and housing allowances included in Ottawa’s 10-year social infrastructure fund will also boost the city’s efforts, she added. Toronto will receive just over $154 million in federal-provincial funding for affordable housing in 2016 and 2017.

“I think we’re heading in the right direction,” Bailao said. “But we need to continue ramping it up.”

Joe Cordiano, president of Dominus Construction Group which won the city’s proposal call to develop the Railway Lands site, said the Open Door Program won’t make him rich, but will make building affordable housing worthwhile.

“We build a lot of condos. But we saw an opportunity here that I think makes sense,” said Cordiano, a former Toronto Liberal MPP who left provincial politics in 2006.

“It’s not easy to build affordable housing. But it’s crucially important to the economy of the GTA that we try,” he said. “The tool box that (the city) has put in place . . . is enough to justify our involvement.”

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